A STUDY ON THE CONTRIBUTION OF THE INDIAN TEXTILE INDUSTRY POST-GST IMPLEMENTATION

Abstract

The Indian textile industry, one of the oldest and most significant sectors of the national economy, contributes substantially to GDP, employment, and export earnings. The introduction of the Goods and Services Tax (GST) in 2017 marked a major tax reform aimed at simplifying the indirect taxation system, eliminating cascading taxes, and promoting a unified market. This review paper examines the impact of GST on the contribution of the Indian textile industry, analyzing trends in taxation, exports, employment, and revenue generation. The study synthesizes secondary data from 2017 to 2023, highlighting both the positive outcomes and challenges faced by the sector. Findings indicate that GST has streamlined the tax structure, reduced operational complexities, and enhanced competitiveness in domestic and international markets. Export performance, while affected by external shocks such as the COVID-19 pandemic, has demonstrated resilience and steady recovery in the post-GST period. Employment trends show gradual growth, reflecting formalization and increased opportunities, particularly in organized units. Additionally, the textile sector has consistently contributed to national GST collections, underscoring its fiscal significance. Despite initial compliance and cash flow challenges, GST has overall facilitated efficiency, transparency, and growth in the textile industry. The paper concludes that sustained policy support, technological adoption, and targeted incentives can further enhance the sector’s contribution to India’s economy.